The Kumasi Metropolitan Assembly (KMA) is likely to lose approximately GH¢7,000,000 during the year 2020 as a result of the COVID-19 pandemic.
The outbreak of the Coronavirus, also known as COVID-19, since March this year, has already adversely affected the finances of the Kumasi Metropolitan Assembly (KMA), resulting in the loss of GH¢1,582,151.27, representing 11.57% loss in revenue as at July 2020.
The Metropolitan Chief Executive (MCE), Osei Assibey Antwi, who announced this in his report to the 1st Ordinary Meeting of the 1st Session of 8th Kumasi Metropolitan Assembly (KMA) recently, said the lost amount would have been higher but for the increases in revenue collections cumulatively from January to March of 2020, as compared to the same period in 2019.
He said the upsurge of the COVID-19 pandemic in Ghana has had a massive impact on the collection of internally generated funds (IGFs) at the KMA particularly, and revenue generation in general.
Our revenue started declining as a result of the COVID-19, beginning April, 2020.
According to the report, GH¢2,899,545.32 recorded for March this year started dwindling from April 2020 when the KMA collected only GH¢616,705.91 IGF (29.27% of revenue) because of the lockdown that lasted for three whole weeks.
The loss, amounting to GH¢12,097,024.05 at the close of July, 2020, a drop in the GH¢13,679,175.32 recorded in 2019 over the same seven month period, from January to July, resulted in a difference of GH¢1,582,151.27 being loss of revenue.
This downward trend in revenue collected continued in the months of May and June, 2020. Experts have also forecasted that the effect of the COVID-19 is likely to continue to the end of the year and beyond.
Explaining what informed the drop in revenue for 2020, the Mayor said most of the revenue collectors were scared of going to the field to collect revenue, while most taxpayers are not expected under these conditions to come to the premises of the KMA to pay their taxes, and businesses and business owners might have lost a lot of business transactions and revenue as a result of the COVID-19.
He said under the circumstance it is also anticipated that business activities will slow down and daily tolls from markets and transport operations are also likely to suffer, since daily tolls lost cannot be recovered.
The Mayor also identified an expected increase of cost of revenue collection, since certain protective items had to be purchased for the staff who must be motivated to go out and collect revenue.
The Metro Chief Executive said the total revenue from 2016 to July, 2020 was GH¢261,262,366.19, and that a total of GH¢123,659,963.39 of internally generated funds was collected for the period under review.
The KMA boss said intergovernmental transfers and compensation from established posts also amounted to GH¢54,766,701.68, while donor support amounted to GH¢82,835,701.12; GH¢77,143,463.97 as compensation for employees; GH¢84,268,330.97 for goods and services, and GH¢103,993,221.06 for assets.
On the annual revenue projections for the Assembly, spanning 2018, 2019, and 2020, the Mayor said the assembly projected GH¢23,734,161.87, GH¢25,596,000.00 and GH¢32,630,495.16 for 2018, 2019 and 2020 respectively, while GH¢22,708,381.22, GH¢24,683,840.45 and GH¢12,097,024.05 was actually collected, indicating that the Assembly realised only 37.07% of the total budgeted revenue against an average of 96% target.
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